Title 58 — INSURANCE

This chapter shall apply only to domestic stock insurers and domestic mutual insurers transacting or proposing to transact insurance on the cash premium or legal reserve plan, except that §§ 58-5-27 , 58-5-28 , 58-5-37 , and 58-5-38 shall also apply to foreign and alien insurers.…

If the attorney general does not approve such articles, he shall return the same to the director with a written statement of his reasons for disapproval. The director shall return all sets of the articles with such written statement to the incorporators. Source: SL 1966, ch 111 ,…

No domestic insurer or insurance producer thereof may knowingly solicit insurance business in any reciprocating state in which it is not then licensed as an authorized insurer. Source: SL 1966, ch 111 , ch 16, § 28 (1); SL 2001, ch 286 , § 70.

Section 58-5-100 shall not prohibit advertising through publication and radio, television, and other broadcasts originating outside such reciprocating state, provided such advertising is not specifically directed to residents of such reciprocating state. Source: SL 1966, ch 111 ,…

Section 58-5-100 shall not prohibit insurance covering persons or risks located in a reciprocating state under contracts solicited and issued in states in which the insurer is then licensed, nor shall it prohibit insurance policies issued by the insurer as an unauthorized insurer…

The director of the Division of Insurance shall, after a hearing, suspend or revoke the certificate of authority of a domestic insurer found by him to have violated §

If provided in its articles of incorporation, a domestic insurer may issue and classify policies with or without participation in profits, savings, or unabsorbed portions of premiums and determine the right to participate and the extent of participation of any class or classes of…

Any domestic insurer which, prior to July 1, 1966, had been issuing all or part of its policies on a participating basis without authorization in its articles of incorporation, may continue to issue such policies. Source: SL 1966, ch 111 , ch 16, § 32 (1).

After the third policy year, no dividend otherwise earned shall be made contingent upon the payment of a renewal premium on any participating policy. Source: SL 1966, ch 111 , ch 16, § 32 (2).

Wherever, in any statutory provision, there is use of the word "member" as applying to a mutual and stock insurance company, the same shall be construed as meaning a participating policyholder of such company and shall have no connotation of membership in such company as when use…

A domestic stock or mutual insurer may borrow money to defray the expenses of its organization, provide it with surplus funds, or for any purpose of its business, upon a written agreement that such money shall be repaid only out of the insurer's surplus in excess of that stipulat…

Any loan pursuant to § 58-5-108 shall be subject to the approval of the director of the Division of Insurance. The insurer shall, in advance of the loan, file with the director a statement of the purpose of the loan and a copy of the proposed loan agreement. The loan and agreemen…

Amendments to the articles of incorporation shall be submitted and filed in the same manner as articles of incorporation in §§ 58-5-8 to 58-5-10 , inclusive, and shall be in compliance with the provisions of this title, the bylaws of such corporation and the laws of this state. S…

Money borrowed pursuant to § 58-5-108 , together with the interest thereon if so stipulated in the agreement, shall not form a part of the insurer's legal liabilities except as to its surplus in excess of the amount thereof stipulated in the agreement, or be the basis of any seto…

Any loan pursuant to § 58-5-108 or substantial portion thereof shall be repaid by the insurer, upon the director's prior approval, when no longer reasonably necessary for the purpose originally intended. Source: SL 1966, ch 111 , ch 16, § 34 (4).

Sections 58-5-108 to 58-5-111 , inclusive, shall not apply to loans obtained by an insurer in the ordinary course of business from banks and other financial institutions, nor to loans secured by pledge or mortgage of assets. Source: SL 1966, ch 111 , ch 16, § 34 (5).

The director may revoke or suspend the certificate of authority of an insurer which has declared or paid a dividend contrary to the general corporation laws of this state. Source: SL 1966, ch 111 , ch 16, § 33.

The deficiency may be cured by cash or assets eligible under chapter 58-27 ; or by amendment of the insurer's certificate of authority to cover only such kind or kinds of insurance thereafter for which such insurer has sufficient basic paid - in capital or minimum basic surplus u…

A stock insurer, upon receiving the director's notice of deficiency as set forth in § 58-5-114 , by resolution of its board of directors and subject to any limitations upon assessment contained in its articles of incorporation, may assess its stockholders for amounts necessary to…

A mutual insurer, upon receiving the director's notice of deficiency as set forth in § 58-5-114 , shall levy such an assessment upon members as is provided for in §§ 58-5-32 to 58-5-36 , inclusive. Source: SL 1966, ch 111 , ch 16, § 36 (2).

If the deficiency is not cured as required by § 58-5-114 , the insurer shall be deemed insolvent and the director shall institute delinquency proceedings as provided in this title. Source: SL 1966, ch 111 , ch 16, § 35 (3).

Before soliciting any applications for insurance as permitted under § 58-5-21 , the incorporators of the proposed insurer shall file with the director a continuing corporate surety bond in the penal sum of twenty - five thousand dollars, to be approved by the director, in favor o…

A domestic stock insurer may reinsure all or substantially all of its insurance in force, or of a major class thereof, with another insurer by an agreement of bulk reinsurance; provided however no such agreement shall become effective unless filed with the director of the Divisio…

The director shall approve such agreement within a reasonable time after such filing unless he finds that it is inequitable to the stockholders or would substantially reduce the protection or service to the policyholders of such domestic insurer. If the director does not approve,…

No director, officer, insurance producer, or employee of any insurer party to such reinsurance, nor any other person, may receive any fee, commission, or other valuable consideration whatsoever for in any manner aiding, promoting, or assisting therein except as set forth in the r…

A domestic mutual insurer may reinsure all or substantially all of its insurance in force, or a major class thereof, with another insurer, by an agreement of bulk reinsurance, provided however no such agreement shall become effective unless filed with the director of the Division…

The director may require that plan and agreement for reinsurance be approved by a vote of not less than two - thirds of each domestic mutual insurer's members voting thereon at meetings of members called for the purpose, pursuant to such reasonable notice and procedure as the dir…

If for reinsurance in a stock insurer of all or substantially all of the insurance in force of a mutual insurer, the agreement must provide for payment in cash to each member of the insurer entitled thereto of his equity, if any, in the business reinsured as determined under a fa…

The director of the Division of Insurance shall approve any agreement pursuant to § 58-5-123 within a reasonable time after filing if he finds it to be fair and equitable to each domestic insurer involved, and that such reinsurance would not substantially reduce the protection or…

No director, officer, insurance producer, or employee of any insurer party to such reinsurance, nor any other person, may receive any fee, commission, or other valuable consideration whatsoever for in any manner aiding, promoting, or assisting therein except as set forth in the r…

A domestic stock insurer may merge or consolidate with other domestic or foreign insurers authorized to transact insurance in this state, by complying with the applicable statutes of this state that govern the merger or consolidation of corporations formed for profit but subject …

Any plan by which a stock insurer proposes to acquire a substantial or controlling stock interest in another stock insurer through an exchange of stock is deemed to be a plan of merger which requires the approval of the director of the Division of Insurance in accordance with pro…

In lieu of such bond, such incorporators may deposit with the director twenty - five thousand dollars or United States government bonds, negotiable and payable to the bearer, with a market value at all times of not less than twenty - five thousand dollars, to be held in trust upo…

No director, officer, insurance producer, or employee of any insurer party to such merger or consolidation may receive any fee, commission, compensation, or other valuable consideration whatsoever for aiding, promoting, or assisting therein except as set forth in such plan and ag…

No such merger or consolidation shall go into effect until the plan and agreement therefor is filed with the director and approved by him after a hearing thereon. Such plan and agreement shall be approved by the director within a reasonable time unless he finds such plan or agree…

If any domestic insurer involved in the proposed merger or consolidation is authorized to transact insurance in other states, the director may request the insurance supervisory officials of such other states to participate in the hearing provided for under §

If the director does not approve any such plan and agreement, he shall notify the insurer in writing, specifying his reasons therefor. Source: SL 1966, ch 111 , ch 16, § 38 (4).

A domestic mutual insurer may merge or consolidate with another insurer under the applicable procedures prescribed by the statutes of this state applying to corporations formed for profit, subject to the provisions of §§ 58-5-135 and

The plan and agreement for merger or consolidation shall be submitted to and approved by at least two - thirds of the members of each mutual insurer involved voting thereon at meetings called for the purpose pursuant to such reasonable notice and procedure as has been approved by…

Sections 58-5-130 to 58-5-133 , inclusive, shall also apply to mergers and consolidations of mutuals. Source: SL 1966, ch 111 , ch 16, § 39 (4). 58-5-137. Repealed by SL 1983, ch 371 , § 3

58-5-138.1 Compensation of officer, insurance producer, or employee of converting mutual insurer prohibited. 58-5-139 Liquidation of domestic mutual insurer--Distribution of remaining assets to members. 58-5-140 Distributive share of each member on liquidation of mutual insurer--…

No domestic mutual insurer in this state may reorganize or convert into a corporation with capital stock unless the reorganization or conversion plan provides each member of the mutual insurer with cash or other valuable consideration for the fair value of the member's equity in …

No director, officer, insurance producer, or employee of any mutual insurer party to a reorganization or conversion to a corporation with capital stock may receive any fee, commission, compensation, or other valuable consideration for that participation except as set forth in the…

Upon any liquidation of a domestic mutual insurer, its assets remaining after liquidation of its indebtedness, policy obligations, repayment of contributed or borrowed surplus, if any, and expenses of administration, shall be distributed to existing persons who were its members a…

Any such bond filed or deposit made shall remain in effect until released by the director upon compliance with §§ 58-5-12 and 58-5-13 or otherwise terminated by law. Source: SL 1966, ch 111 , ch 16, § 10 (3).

The distributive share of each such member shall be in the proportion that the aggregate premiums earned by the insurer on the policies of the member during the combined periods of his membership bear to the aggregate of all premiums so earned on the policies of all such members.…

Every insurer domiciled in this state shall file a report with the director disclosing material acquisitions and dispositions of assets or material nonrenewals, cancellations, or revisions of ceded reinsurance programs unless the acquisitions and dispositions of assets or materia…

Any report obtained by or disclosed to the director pursuant to §§ 58-5-143 to 58-5-153 , inclusive, shall be given confidential treatment and may not be subject to subpoena and may not be made public by the director, the National Association of Insurance Commissioners, or any ot…

No acquisitions or dispositions of assets need be reported pursuant to § 58-5-143 if the acquisitions or dispositions are not material. For purposes of this chapter, a material acquisition, or the aggregate of any series of acquisitions during any thirty - day period, or disposit…

Asset acquisitions subject to this chapter include every purchase, lease, exchange, merger, consolidation, succession, or other acquisition other than the construction or development of real property by or for the reporting insurer or the acquisition of materials related thereto.…